The first of the GDSA’s three commitments encourages member countries to take action towards, “incorporating the value of natural capital in public and private policies and decision-making.” Under this commitment, the GDSA Secretariat works to highlight and promote the progress that member countries are making in valuing and accounting for their natural capital.
What is Ecosystem Valuation? What is Natural Capital Accounting?
Nature is foundational to the prosperity and security of people and economies. Natural capital, which includes all of nature’s assets — geology, soil, air, water, and all living things — provides a wide range of ecosystem services to people and is estimated to contribute to 36% of the total wealth of developing countries worldwide (World Bank, 2011). Yet, many of the benefits we receive from nature and the impacts we have on nature remain hidden and are often not taken into consideration when making decisions. As a result, nature is being eroded at an alarming rate; the loss of forest alone is costing the global economy between $2 and $5 trillion per year, or nearly one-third of the U.S. economy (The Economics of Ecosystems and Biodiversity (TEEB), 2010). Neither the value of natural capital nor the impacts of its loss are captured in the System of National Accounts, which is used by nations to measure economic activity and by decision makers to assess performance, set policy, and report on progress.
Ecosystem valuation is the measurement and valuation — in monetary and non-monetary terms — of ecosystem services. These assessments can include non-monetary assessments of ecosystem integrity, health, or resilience as well as valuation of specific ecosystem goods/services in monetary terms. The information provided by these assessments are often valuable to decision-making.
Natural Capital Accounting (NCA) is commonly defined as the measurement of stocks of natural resources (both renewable and non-renewable) and the flows of benefits they provide. The differentiation between NCA and ecosystem valuation is that NCA is often a repeated, regular effort following accounting standards. NCA seeks to capture and integrate the contribution of nature into the systems that the private and public sectors use to make decisions. In the private sector, the Natural Capital Protocol is setting the standard for the integration of nature into business decision-making; more than 40 businesses are piloting the protocol, which was developed with the help of Conservation International’s scientists. Meanwhile, NCA efforts in the public sector, typically referred to as environmental-economic accounting, are the domain of the United Nation’s System of Environmental-Economic Accounts (SEEA). The SEEA is an internationally accepted framework to make explicit the interactions between the economy and the environment. The SEEA is an important step towards the incorporation of nature into the System of National Accounts and includes the Central Framework (CF) — which deals with, for example, water, energy, and mineral accounts — as well as guidelines for the next generation of standards under development known as Ecosystem Accounting (EA).
Watch: African countries lead on natural capital accounting
Through the Gaborone Declaration for Sustainability in Africa, countries are looking beyond national borders to preserve and manage Africa's vast natural wealth for future generations.
This video was produced by the Gaborone Declaration for Sustainability in Africa, Conservation International, and Wealth Accounting and the Valuation of Ecosystem Services (WAVES), a World Bank-led global partnership.
Ecosystem Valuation and Natural Capital Accounting initiatives across the GDSA
All of the ten GDSA member countries have undertaken sub-national or national initiatives on ecosystem valuation and natural capital accounting. In many cases, these initiatives are supported by external donors and partners, including the Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ), The Economics of Ecosystems and Biodiversity (TEEB) initiative, the World Bank Wealth Accounting and Valuation of Ecosystem Services (WAVES) partnership, the United Nations Environment Programme (UNEP), and the United Nations Statistical Division (UNSD). Progress on the initiatives being undertaken in GDSA member countries is summarized in a 2015 desktop scoping of all the GDSA countries as well as a 2016 report summarizing a readiness scoping exercise with seven countries.
GDSA work on Ecosystem Valuation and Natural Capital Accounting
The GDSA works to add value to existing initiatives that are working in and across the GDSA countries on this topic. Several initiatives are detailed, below:
Regional Collaboration: the GDSA NCA Community of Practice
The GDSA has encouraged regional collaboration across the member countries and non-State entities undertaking NCA across the GDSA. The first workshop on regional collaboration was held in June 2016 in Nairobi, Kenya and was attended by delegations from 12 African countries. This workshop was co-organized together with Conservation International (CI) and the World Bank WAVES partnership and resulted in the issuance of the GDSA NCA Statement. This statement calls upon the GDSA to foster continued regional collaboration across the GDSA in the form of meetings, trainings, and learning exchanges. As we continue to promote learning across the GDSA, we have launched an email newsletter. Want to get updates from our community of practice? Sign up for the email newsletter in the form below:
Resourcing of efforts and technical assistance
The GDSA is available to provide assistance to member countries in resourcing ecosystem valuation and natural capital accounting efforts. In the past, the GDSA has worked with member countries to identify funding opportunities for NCA, including via GEF STAR allocations. In addition, and when funding has been identified, the GDSA — via Conservation International or other partners — can provide technical assistance to countries on issues related to ecosystem accounting and natural capital accounting. For example, Conservation International has been working with the Government of Liberia on putting together a set of pilot ecosystem accounts as a “proof of concept” to facilitate additional work on this subject in the country.
Ecosystem Accounting across the GDSA
Conservation International (CI), the U.S. National Aeronautics and Space Administration (NASA), and the GDSA propose to pilot ecosystem extent accounts in the GDSA, as a building block for wider ecosystem accounting work across the region. This project aims to work together with select pilot countries interested in ecosystem accounting, that contain representative biomes of sub-Saharan Africa. The project seeks to provide participating countries with a basis for monitoring changes in natural capital over time, identifying areas under threat and understanding the dependence of economic actors on ecosystems. The proposed project is in the design, consolation, and fundraising phase, with CI leading the fundraising efforts. The results of the project will be used by CI and partners to advance Natural Capital Accounting in the GDSA countries. More information available here.
For more information, please contact:
Dr. Kim Reuter
Technical Director, Gaborone Declaration for Sustainability in Africa
Photo credits, top to bottom: Header: © George Steinmetz/Corbis; © Benjamin Drummond (left); © Conservation International / Bailey Evans